What are some common risks involved in a commercial real estate deal?
Commercial real estate is one of the best ways that you can increase the value of a piece of property. You can put a building on it, you can make a determination to tear down a building. You can make a determination that you're going to convert it from retail, to apartments, to other types of uses.
However, there are things that you have to be concerned about. Commercial real estate, often times, puts you in a situation where you don't know what the activity was on that property before you picked it up. So you want to have something called an EPA review of the site. There are different types of levels of this. Level one is a simple one. Where you typically will have-
The lawyer that you will engage, rather, will typically have someone who will go out and determine whether any spills have taken place, anything's been reported along those lines. As the levels get larger, level two for example, the investigation gets deeper and deeper. You don't want to buy a piece of property, to tear down the gas station, to put up your new jewelry store, if you find out that there are USTs or underground storage tanks buried on that property.
Because, when you buy it, you're going to be stuck with cleaning it up. Therefore, you should have a lawyer involved in helping you make certain that your rights are protected, and that you are making the right investment with your money.